A recent Moody's report suggests continued growth in European private credit markets despite recent slowdowns. Anticipated inflows this year, driven by adjustments to higher rates and increased retail investor participation, highlight the sector's resilience.
European private credit has outpaced the US market over the past decade, buoyed by regulatory changes like ELTIF regulations. Flexible offerings and execution certainty have attracted diverse investors, although rising default risks remain a concern.
Looking ahead, Moody's predicts diversification in European private credit strategies, mirroring US trends. Asset-backed finance, including hybrid debt-equity financing, presents significant opportunities for growth.
In summary, the report underscores the enduring appeal and evolving landscape of European private credit, poised for further expansion despite challenges.
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